Electronics: Mexico’s new export darling is an old nemesis in disguise
Computers are now worth more than auto exports; they are only a fraction as beneficial to Mexico’s economy.
The world’s biggest technology trade fair, the Taipei International Information Technology Show—Computex, as it is best known—is where the future of computing is often decided. Tech titans like Nvidia’s Jensen Huang make space in their agendas to make an appearance.
Mexico is part of that future, as Taiwanese companies look to shift large portions of their production there to keep close to their main market—the United States—and away from the perilous waters of the South China Sea.
While most international investors have been lukewarm about breaking ground in Mexico, a single Mexican consultant claimed in one interview to have already brought over eight Taiwanese computer manufacturers since 2024. Nary a year has passed in which Foxconn hasn’t announced another factory. Today there are 14 spread across northern and central Mexico.
The precipitous rise of artificial intelligence in the US has created in its wake a voracious need for the hardware that keeps all those AI chat bots spewing inanities and driving the stock exchange to historic heights in the midst of a global energy crisis.
Similarly, no trade war or contentious commercial negotiation is scary enough to keep computer electronics manufacturers away from Mexico. Despite its many foibles, it is a country which has the skill, the affordability, and the closeness to the US to make it irresistible.
Mexico, as a consequence, is now shipping out higher values of computing equipment than what was previously North America’s historically most important export, the auto industry. With over 50% of AI-proximate hardware heading from Mexican factories to the US, The Mexico Political Economist has gone as far as to argue that Mexico is the source of US economic growth.
The Mexican press, government, and business sectors have all converged to celebrate around this rare bit of good news. It’s a trap.
